Swiss watchdog investigates boycott by big banks of Apple Pay, Samsung Pay

Raided offices

The competition authority WEKO has raided offices of banks like UBS, Credit Suisse in Switzerland as part of investigation of whether boycott of global mobile payments solution is a thing in the country. The watchdog has suspicions that banks were blocking addition of their credit cards to worldwide known mobile payments applications like Apple Pay and Samsung Pay. Instead, they were supposed to favor TWINT, a local fintech company. WEKO informed about its investigation and suspicions in a statement published on Thursday, 15th November. Investigation includes also local Swiss financial companies: PostFinance, a state-owned bank, Aduno Holding, Swisscard AECS GmbH. Aduno Holding confirmed its offices were searched by WEKO but declined any further comment.

Banks deny allegations

Some investigated companies refused to comment the matter – including Aduno Holding, others decided to publicly defend themselves. Credit Suisse said in a statement that: “We are surprised about this investigation and are convinced that the allegations will prove to be unfounded”. Additionally, the bank informed that their clients have access to fintech apps Samsung Pay and Apple Pay via its 50 percent subsidiary Swisscard. Also, it has been negotiating with Google, Apple and Samsung over using their mobile solutions with bank’s credit cards. Result of this negotiations was not disclosed. Whereas, UBS informed it had tried to make a deal with Apple Pay already in 2016, but negotiations fell flat. Thus, the bank’s cards are not compatible with the mobile payments application. As UBS concluded: “Although we offered a number of alternative solutions, unfortunately we weren’t able to reach an agreement with Apple Pay to cooperate”. PostFinance denied braking any of anti-cartel Swiss laws and informed it is open to co-operating with WEKO to set the record straight.

TWINT is surprised

Meanwhile, the company in the middle od the storm, TWINT, is said to be surprised by the WEKO probe. TWINT is a Swiss fintech joint-venture of biggest banks in the country. It created a digital payment application, that it is yet to hit it big in Switzerland. Swiss residents are resistant to mobile payments with only 0.2 percent transactions occurring via smartphones. TWINT was aiming for one million users by end of 2017, but instead it had only 750,000 users as of April 2018. Apple Pay was the first major competitor to TWINT on Swiss market as it entered it in 2016, the same year TWINT was founded.  In another twist to the quite eventful day for Swiss fintech market, TWINT has informed it has filed it own complaint some time ago to WEKO about Apple discriminatory actions. TWINT alleges that Apple is preventing smooth usage of its application on iOS devices. WEKO is supposed to issue a decision on that matter soon. Apple so far declined to comment on TWINT’s allegations and WEKO newest probe.

Source of citations: https://in.reuters.com/article/swiss-competition/update-2-swiss-watchdog-investigates-banks-over-alleged-payments-system-boycott-idINL8N1XQ0YP

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